10MP Another 5 Years of Hell

Our nation's overall policy framework is to achieve the committed Vision 2020 which is to become a fully developed nation. How to define developed status? I also don't know as the term developed is very contentious and can be fiercely debated. However let me try by giving you a KISS ladies only (keeping it short and simple).

• Income or GDP per capita. GDP is a measure of a country's overall economic output, per capita means per individual. This indicator has been proven to correlate well with standards of living. High income economies as defined by World Bank are countries with GDP/capita of $12,000 and above. Below by World Bank 2008 report. We are thus graded as upper-middle income economy. Boleh boleh la..
• Singapore at $37,500
• Hong Kong at $30,000
• South Korea at $20,000
• Malaysia is at $8,200
  
• Thailand at $4,000
• Indonesia at $2,000

• The other indicator is Human Development Index (HDI). A gauge of the country's level of human development (life expectancy at birth, access to knowledge and standard of living). Again a strong correlation that a high HDI comes with a prosperous economy. Countries with a score of >0.800 are considered to have high standards of human development. We are under high human development countries but still one grade below first world countries (>0.900).
• Singapore at 0.944
• Hong Kong at 0.944
• South Korea at 0.937
• Malaysia is at 0.829
  
• Thailand at 0.783
• Indonesia at 0.734

I am really really REALLY sure everyone is confused with our national reforms. Needless to say there are many things to be implemented, so let me simplify it for you. The implementation of these systematic reforms can be distinguished via four key items:

• NEM or New Economic Model: represents economic transformation; the framework to guide our economic strategy or country "roadmap". NEM is the mastermind.
• GTP or Govt Transformation Plan: to transform the govt's work processes by improving delivery of activities. GTP is really only about our dear government.
• 1Malaysia: emphasize ethnic harmony, national unity and efficient governance. 1Malaysia is the peacekeeper.
• 10MP or 10th Malaysia Plan: outline strategic directions towards a high income and develop nation by 2020, macroeconomic framework and the KRAs (key area results). 10MP is the real money maker.

There you have it, the mastermind that defines the roadmap for the government to pursue our future riches via money making machines and at the same time having our peacekeeper to avoid racial tensions. Sounds very nice on paper BUT my point here is that the 10MP is full of holes, far more than your face ah no offense.

Our 10MP is targeting a GDP growth of 6% per annum from 2011-2015 lead by private sector underpinned by services sector. Another goal is to increase income per capita from our current $8,200 (RM27,000) to $12,140 (RM40,000) by 2015. In the media it says "An ambitious but achievable 10MP", I doubt the targets and especially the plan outlined in achieving them. One point to note is that we never achieved our targets for our 8MP and 9MP respectively and this 10MP is going to be no different in the long run.

First Point to aboi
The federal government's development allocation for 10MP amounts to RM230bil, the same amount for 9MP, it is stagnant. That equates to RM46bil per year. Where else our operating expenditure is RM150bil in 2009 alone and is on the rise by 15% CAGR. This is like a situation whereby you own a house (country), you pay more on your bills (operating expenses) than to renovate or upgrade features in your home (development allocation). There is a need to reduce subsidies or at least to target subsidies to people who deserve it. Refer to my earlier post on Undercovering Malaysian Budget

I am dismayed that the development allocations is not increased even though govt has said it will reduce subsidies which alone eats up RM76bil in 2009. Subsidies are meant for the poor, not for everyone (both foreigners and locals).

Second Point to aboi
The usual more and more projects, MRT in Kuala Lumpur, seven highway projects and two coal electricity generation plants and many others totaling at RM60bil++. Handing down more projects is going to fuel our motto: "First world infrastructure, third world mentality." There has to be a greater need to focus on human capital and not hardware which we have been doing since 1990s. But what is worse is that these mega projects are not made as open tenders. So the govt awards it to selected companies or in better words; cronies. Big hugs to our PM.

!! because this contradicts with NEM that says that any opportunities are given to the best proposals and to obtain best value via open tenders. Corruption will live on. 

Third Point to aboi
This one is really astounding, the 30% target for bumiputera is still ON in 10MP but if you read NEM it clearly says that everything is based on merit, competition and need. Perhaps that need is that 30% LMAO (laugh my ass off). Not just in corporate equity but also now wealth in areas of property, jobs and so on. This is not the way to create a high income nation by setting quotes that is based on needs and not on productivity. Learn to be more competitive before you start demanding le.

A big swt as this will not bode well in attracting foreign direct investments (FDI) because it does not distinguish between the rich and poor Bumiputeras. Also, will projects or opportunities be awarded based on competitiveness and transparency or just merely wanting to hit the 30% quota? This kind of dilemma will make us unattractive to foreign investors.

Fourth Point to aboi
GDP growth 6% pa until 2015 using private investment to fuel it by growing 12.8% pa is an extremely tall order to achieve. You have to be an ultra-optimistic if there is such word to hit that target. Our last MPs our GDP was 4.7% and 4.2% on average with growth driven by public sector and private investment only 2%. In order to grow 12.8% pa, we need more FDIs which is something we are not just lacking but losing! FDI has only been growing at 1% per annum, which pales in comparison to China’s 10% and Singapore’s 9%.

Be more realistic with the targets, if the govt intends to attract more FDIs, there is a need to be more transparent such as open tenders, no more quota, liberation of some services & improve efficiency. There is no way we can turn quickly from 1% to 10%-12% for FDIs to hit our 10MP targets.

Fifth Point to aboi
Education. RM280mil sum for all government aided schools for renovation and upgrading through 2011-2012. RM280mil is very minuscule! We have 1,900 govt aided schools which amounts to RM75,000 per year per school. Is that a lot? I don't think so. There is a need to readjust the allocation to education sector, not just infrastructure wise. I still remember I had to learn PC in school using Windows 98 when my house is already equipped with Windows XP. There is also a lack of quality teacher as many do not have the passion, interest or motivation. Being a teacher is quite a 'last resort profession' in this country.
Aboi says pour more funds into education but ensure it is being used wisely, stop the habit of changing syllabus every time the education minister changes, make teacher the first choice like China; paying 100% salary as pension. Perhaps then aboi will change profession and quit current job :) I like what Lim Kit Siang said, In Malaysia, we pay peanuts and so we get monkeys.” 

There are many other faults with the 10MP but the above five points (aboi 5 - 0 government) are really the highlights we need to overcome if we are to achieve Vision 2020. The 10MP is most likely, if not highly probable to be another flop, if you don't believe it accept my bet lor and I can be tai ee long (money collector) in 2015. All I can say is we are going to have another 5 years of hell and that is the end of it, we are never going to achieve Vision 2020. Change to 2050 la, boleh boleh everything also boleh..

What can you do or expect?

1. Vote for change. Between two evils, choose the lesser one since the greater evil is already sending us to 'Holland'. The word evil refers to our two main political parties.
2. Spread the word. Be a teacher yourself, let others know what you know. Re-educate yourself with the news around you and you will know what lies ahead in your life and your family as well.
3. Don't be complacent. Just because you have a secure job it doesn't mean it is going to be there forever. With the rate our country is going especially with FDI, I am quite afraid, you should too.
4. Don't complain expensive. If you truly want things to change, subsidies have to go no matter what. Govt manja us for far too long, it should be time to face the reality of actual market prices. Spend less lor, will you die if you stop eating in restaurants and cook yourself or eat at hawker stall? No right.

I am no economist nor do I own any certification in finance but I dare to say I am not dumb to be fooled by unachievable gains or unfairness that is plaguing our god forsaken country. Long live our king and country! (I hope).

Lazy: The highlights of the 10MP can be found at Business Times
Kut Lat: The details of the 10MP can be found at Economic Planning Unit (EPU)